three sections. Memo’s motion seeks judgment under §523(a)(4). The Court has jurisdiction under 28 U.S.C. §§ 157 and 1334. The motions are denied because neither party has established the right to judgment as a matter of law.

The Uncontroverted Facts

Debtor filed for bankruptcy on February 24, 2011. Debtor was the sole officer and director of Toor Enterprises, Inc. In 2010, Toor Enterprises operated two convenience stores in Ohio. On May 24, 2010, Toor Enterprises and Debtor entered into an agreement with Memo to sell money orders. The agreement ended about two months later.

Conclusions of Law

A. Summary Judgment Standard. Summary judgment is appropriate if the moving party demonstrates there is no genuine issue as to any material fact, and he is entitled to judgment as a matter of law.2 Only when reasonable minds could not differ as to the import of the proffered evidence is summary judgment proper.3 The court construes the record liberally in favor of the party opposing the motion.4 An issue is “genuine” if sufficient evidence exists on each side “so that a rational trier of fact could resolve the issue either way” and “[a]n issue is ‘material’ if under the substantive law it is essential to the proper disposition of the claim.”5 The court does not weigh the evidence at this stage, but merely determines whether a trial is necessary.6 As a general rule, questions involving intent or state of mind cannot be resolved by summary judgment.7

Cross-motions for summary judgment allow the court to assume the only evidence to be considered has been submitted with the pleadings. However, cross-motions are to be considered independently, and summary judgment is not appropriate if material facts remain in dispute.8

B. The Proper Procedure for Supporting Factual Positions. Federal Rule of Civil Procedure 56 incorporated into adversary proceedings pursuant to Fed. R. Bankr. P. 7056 provides a party asserting a fact must support the assertion by citing to particular parts of materials in the record, including depositions, documents, electronically stored information, affidavits or declarations, stipulations (including those made for purposes of the motion only), admissions, interrogatory answers, or other materials. Only admissible evidence may be considered. Documentary evidence must be sworn or certified by a sufficient affidavit or otherwise authenticated as required by Fed. R. Civ. P. 56 to be admissible.9 Summary judgment affidavits must be based upon personal knowledge and must contain information admissible at trial.10 Statements of mere belief are disregarded. An affidavit that purports to testify concerning another party’s intent is improper. The affidavit may not be based upon conclusory statements without specific supporting facts. If a party is unable to present facts essential to justify its opposition, the court may allow the party more time to conduct discovery or obtain affidavits.11 If a party fails to support his motion or opposition as required by Fed. R. Civ. P. 56(c), the court may give the party an opportunity to properly support or address the facts.12

C. Debtor’s Factual Record Does Not Satisfy Fed. R. Civ. P. 56(c). The conflicting evidence and assertions contained in the summary judgment motions raise far too many factual disputes to entitle either party judgment as a matter of law. Debtor’s motion, in particular, is not properly supported. The memorandum in support contains only three facts. The core of Debtor’s defense is actually comprised of unsupported factual assertions peppered throughout Debtor’s briefs without so much as an affidavit from the Debtor himself. Yet, this case is not amenable to evidence presented solely by affidavits because the allegations and defenses asserted are going to depend on the credibility of the witnesses.

Just as Debtor’s motion is not supported by a sufficient factual record, Debtor’s opposition to Plaintiff’s cross-motion for summary judgment is likewise deficient. Debtor shall be granted an opportunity to properly address Plaintiff’s motion under either Fed. R. Civ. P. 56(d) and (e) or at trial. Despite Debtor’s objection to the contrary, Plaintiff’s affidavit from a Memo credit manager is properly sworn and becomes part of the record upon its inclusion in the summary judgment materials. One paragraph is inadmissible because it is based on belief. The rest of the affidavit is admissible. If Debtor’s objection is that he has not had an opportunity to depose the affiant, Debtor may seek time to do so under Fed. R. Civ. P. 56(d)(2). While Fed. R. Civ. P. 56(e) allows the court to consider unanswered factual assertions to be undisputed for purposes of the motion, it also allows the party lacking support an opportunity to properly address the facts. Debtor shall be afforded that opportunity because Plaintiff’s motion fails to establish it is entitled to judgment even if its facts are deemed undisputed.

D. Dischargeability under 11 U.S.C. §523. An exception to discharge is narrowly construed with deference given to the fresh-start policy of the Bankruptcy Code.13 The party opposing the discharge of a debt carries the burden of proof by a preponderance of the evidence.

E. Fraud or Defalcation While Acting in a Fiduciary Capacity. A §523(a)(4) claim requires fraud or defalcation while acting in a fiduciary capacity, embezzlement, or larceny. The plaintiff must establish a fiduciary relationship between itself and the defendant, and fraud or defalcation committed by the defendant while acting in his fiduciary capacity.14 Fiduciary is narrowly defined under §523(a)(4) and is a question of federal law, although state law may be relevant in determining when a trust exists.15 For questions of federal law, bankruptcy courts must follow the law of their own circuit.16 The Tenth Circuit requires an express or technical trust to exist prior to the act creating the debt.17 The mere use of the term “trust” does not necessarily create a trust.18 A debt created while acting in a fiduciary capacity is the result of a breach of pre-existing trust obligations defined by law and is separate and distinct from any underlying contractual debt which arises from a debtor’s breach of an agreement with respect to goods or services. Ordinary commercial relationships such as

establish a trust relationship as opposed to a debtor-creditor relationship or a principal-agent relationship. The written contract uses the word “trust,” but it also refers to a principal-agent relationship and grants a security interest to Memo in the money order proceeds. The factual record is also lacking evidence regarding Debtor’s intent or actions related to the alleged defalcation.

The briefs frame the parties’ arguments; however they lack an adequate factual record. Summary judgment is not appropriate

Conclusion

IT IS THEREFORE ORDERED Plaintiff’s Motion for Summary Judgment under 11 U.S.C. § 523(a)(4) is DENIED. IT IS FURTHER ORDERED Defendant’s Motion for Summary Judgment is DENIED. ### ROBERT D. BERGER